Corporate Social Responsibility and Social EntrepreneurshipCairo UniversityDr. Sherifa Fouad Sherif

History of CSR

•The term Corporate Social Responsibility came in to common use in the 1950’s, 1960’s and 1970’s with the beginning of the term stakeholder.

•A stakeholder is “any group or individual who can affect or is affected by the achievement of an organization's purpose.” It is in the company’s strategic interest to respect the interests of all its stakeholders.

Definitions of Corporate Social Responsibility

•The World Bank:•Corporate Social Responsibility (CSR) is

the commitment of business to contribute to sustainable economic development, working with employees, their families, the local community and society at large to improve quality of life, in ways that are both good for business and good for development.

Definition of CSR

▫Corporate Social Responsibility is the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large.

▫– World Business Council For Sustainable Development

Definitions of CSRCorporate Social Responsibility•Firms have responsibilities to societies

including economic, legal, ethical and discretionary (or philanthropic).

•Philanthropic: receiving aid from funds set aside for humanitarian purposes. Some call it charity.

Definition of CSR

•Companies have two kinds of responsibilities, commercial and social. Commercial entails running the business successfully, social entails taking responsibity as an actor in society and the community by engaging in activities that go beyond making profit, such as protecting the environment, taking care of employees and being ethical in trade.

•CEO, McDonalds

Purpose of CSR

•The purpose of CSR is to make corporate business activities sustainable in its three dimensions:▫Economic▫Social▫Environmental

Benefits of CSR

•Source of competitive advantage•Attracts ethically conscious customers• Increase profit in the long run•Reduction of costs (re-cycling)•Contribute to economic development• Improve the quality of life for it workforce and their

families• Improvement of society•Tax-free incentives for businesses

Corporate Social Responsibility

What is Corporate Social Responsibility?

The company must act responsibly, and criteria for social responsibility must be adopted to contribute toward consolidating better companies not only in social terms – that is, companies which are more useful to society – but better companies in purely economic terms – that is, better quality, more efficient, more competitive companies

An inevitably broad concept of which we can say that it includes voluntary actions by companies aimed at dealing with workers’, consumers’, or investors or shareholders’ concerns: in short, the concerns of all citizens.

What is Corporate Social Responsibility?

Some attempt to define it:

Responsible companies perceive the current environment – globalization, social demands, transparency, broadening of markets, environmental challenges, etc. – as an opportunity to underscore their role in society, their potential for leadership in sustainable development.

Some call it a WIN-WIN situation

What is CSR?The impact of a company’s action on societyRequires a manager to consider his acts in terms of a whole social system and holds him responsible for the effects of his acts at all levels in that systemBusinesses have an obligation to society which extends beyond economic and legal dutiesDescribed as one of the most important social movements of our time

Evolution of CSR•CSR refers to the strategies corporations or firms

conduct their business in a way that is ethical, society friendly and beneficial to the community in terms of development.

•The definition has been changing in meaning and in practice.

•CSR was limited to philanthropy and has currently shifted to emphasis on business-society relations. Corporations contributing and providing solutions for social problems.

Evolution of CSR

•Phase One-Charity, Philanthropy-Drivers culture and religion.

•Phase Two-Dedication to the progress of society•Phase Three-1960-1980-Shift from the focus on

Public organizations to private organizations for socio-economic development

•Phase Four- 1980-present-Concern for labor and environmental standards

Present Day CSR•The concept has evolved whereby organizations

consider the interest of society by taking responsibility for the impact of their activities on customers, suppliers, employees, shareholders, communities and other stakeholders as well as the environment.

•Focusing on improving the well-being of the local community and society at large.

•Creating wealth in society and providing better standards of living.

Corporate Social Responsibility Pyramid

Key Issues in CSR• Labor rights

•Environmental conditions

•Human rights

•Poverty Alleviation

Evolution of CSR

•Although the contemporary CSR agenda is maturing, the term “CSR” has not yet taken hold within many public sector agencies, either in industrial or developing countries. Few government initiatives have been undertaken explicitly as “pro-CSR initiatives”.

Different Names For CSR

•Corporate Social Responsibility (CSR)•Corporate Conscience•Corporate Citizenship•Responsible Business•Responsible Management•Corporate Philanthropy•Sustainable Business•Creating Shared Values (CSV)

Levels of CSR

Social Obligation – Meet minimum regulations, do what is required by law, no moreSocial Responsibility – Go beyond what is required by lawSocial Responsiveness – Proactive approach, promote positive change

CSR Concepts

•Corporate Social Responsibility-emphasizes obligation and accountability to society.

•Corporate Social Responsiveness-emphasizes action and activity.

•Corporate Social Performance-emphasizes outcomes and results.

Regulations• ISO, the International Organization for Standardization,

has launched an International Standard providing guidelines for social responsibility (SR) named ISO 26000 or simply ISO SR, released November 2010.

• ISO 26000 gives guidance on SR. It integrates international expertise on social responsibility – what it means, what issues an organization needs to address in order to operate in a socially responsible manner, and what is best practice in implementing SR.

ISO 26000

• It is intended for use by organizations of all types, in both public and private sectors, in developed and developing countries, as well as in economies in transition. ISO 26000 is a powerful SR tool to assist organizations to move from good intentions to good actions.

• ISO 26000 contains voluntary guidance, not requirements, and therefore is not for use as a certification standard like ISO 9001 and ISO 14001.

What benefits can be achieved by implementing ISO 26000?

• Competitive advantage• Reputation• Ability to attract and retain workers, customers, clients • Maintenance of employees’ morale, commitment and

productivity• View of investors, owners, donors, sponsors and the

financial community• Relationship with companies, governments, the media,

suppliers, peers, customers and the community in which it operates.

Regulation of Corporate Responsibility• UN Global Compact-UN initiative to encourage business

worldwide to adopt sustainable and socially responsible policies and report their implementations. Supporting the Millennium Development Goals. Launched by Kofi Enan in 2004.

• The Global Compact is a principle based framework for businesses, stating 10 principles in the areas of:▫Human Rights▫ Labor Standards▫Environment▫Anti-corruption

CSR Management:Organizational Structure

Board of Directors

President & CEO

Group Presidents Chief Financial Officer

VP of Human Resources

General Counsel Corporate Responsibility Officer

Steering Committee

Audit Committee of Board

CSR Management:Plan, Do, Check, Act method

•Plan

• Consult stakeholders

• Set targets

•Do

• Establish management systems and personnel

Plan, Do, Check, Act Method•Act

• Take Corrective action

• Check

• Measure progress

• Audit

• Monitor

• Report

Top Trends in CSR For 2013• According to Forbes magazine:

▫1. Going Global▫2. Increasing the level of transparency▫3. Employee engagement▫4. Collaboration-companies compete and collaborate on

CSR issues▫5. Social Media-as a essential communicating tool for CSR

programs▫6. More focus on Human Rights▫7. Earths growing population-stretching resources to cope

with increase, looking for more energy efficient ideas

Success Stories in Egypt• Vodafone• Coca Cola• Pepsi• Etisalat• Siemens• Petro-safe• Starbucks• McDonalds• Proctor and Gamble• Price WaterHouse Cooper (PWC)• Bank Misr (Misr el Kheir)

CSR and SE

•What is the difference between Corporate Social Responsibility and Social Entrepreneurship?

• To be answered next lecture• Thank You